ArcelorMittal (MT - Free Report) reported a net loss of $1,120 million or $1.11 per share in first-quarter 2020 against a profit of $414 million or 41 cents in the year-ago quarter.
Barring one-time items, adjusted loss per share were 60 cents against the Zacks Consensus Estimate of earnings of 5 cents.
Total sales fell 22.6% year over year to $14,844 million in the quarter. The figure also trailed the Zacks Consensus Estimate of $15,509.5 million.
Total steel shipments fell 10.6% year over year to 19.5 million metric tons.
ArcelorMittal Price, Consensus and EPS Surprise
Segment Review
NAFTA: Crude steel production rose 2.1% year over year to 5.5 million metric tons in the reported quarter. Steel shipments rose 4.1% year over year to 5.5 million metric tons. Sales fell 15.4% year over year to $4.3 billion. Average steel selling price declined 18.2% year over year to $715 per ton.
Brazil: Crude steel production fell 11.1% year over year to 2.7 million metric tons. Shipments fell 18.4% year over year to 2.4 million metric tons. Sales declined 26.2% year over year to $1.6 billion. Average steel selling price fell 8.8% year over year to $642 per ton.
Europe: Crude steel production fell 19.9% year over year to 9.9 million metric tons in the reported quarter. Shipments fell 19.5% year over year to nearly 9.3 million metric tons. Sales fell 27.1% year over year to $7.7 billion, while average steel selling price declined 12.5% year over year to $638 per ton.
Asia Africa and CIS (ACIS): Sales fell 12.1% year over year to $1.4 billion. Crude steel production totaled nearly 3 million metric tons, down 9.8% year over year. Shipments fell 1.8% year over year to around 2.6 million metric tons. Average selling prices declined 12.9% year over year to $471 per ton.
Mining: Iron ore production totaled 14.4 million metric tons, up from 14.1 million metric tons in the year-ago quarter. Coal production totaled 1.3 million metric tons, up from 1.2 million metric tons in the prior-year quarter. Sales fell 12.2% year over year to $990 million.
Financials
At the end of the first quarter of 2020, ArcelorMittal had cash and cash equivalents of around $4.3 billion, up from $2.2 billion in first-quarter 2019. The company’s long-term debt was $10.7 billion, up 0.6% year over year.
Net cash from operating activities fell 38.8% year over year to $594 million in the first quarter.
Outlook
The company expects steel shipments for the second quarter in the range 13.5-14.5 million metric tons. It expects fixed costs to decline 25-30% in the second quarter resulting from the actions taken by the company to reduce all costs in-line with reduced operating rates. EBITDA for the second quarter is expected to between $0.4 billion and $0.6 billion.
Moreover, the company’s board has suspended dividend payments until the operating environment normalizes. The company also withdrew its guidance for apparent steel consumption.
Price Performance
ArcelorMittal’s shares have lost 33.8% in the past year compared with 30.2% decline of the industry.
Zacks Rank & Key Picks
ArcelorMittal currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the basic materials space are Agnico Eagle Mines Limited (AEM - Free Report) , Newmont Corporation (NEM - Free Report) and Franco-Nevada Corporation (FNV - Free Report) , all carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Agnico Eagle has an expected earnings growth rate of 74.2% for 2020. The company’s shares have surged 58.7% in the past year.
Newmont has an expected earnings growth rate of 96.2% for 2020. Its shares have returned 108.8% in the past year.
Franco-Nevada has an expected earnings growth rate of 22% for 2020. The company’s shares have surged 89.2% in the past year.
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ArcelorMittal (MT - Free Report) reported a net loss of $1,120 million or $1.11 per share in first-quarter 2020 against a profit of $414 million or 41 cents in the year-ago quarter.
Barring one-time items, adjusted loss per share were 60 cents against the Zacks Consensus Estimate of earnings of 5 cents.
Total sales fell 22.6% year over year to $14,844 million in the quarter. The figure also trailed the Zacks Consensus Estimate of $15,509.5 million.
Total steel shipments fell 10.6% year over year to 19.5 million metric tons.
ArcelorMittal Price, Consensus and EPS Surprise
Segment Review
NAFTA: Crude steel production rose 2.1% year over year to 5.5 million metric tons in the reported quarter. Steel shipments rose 4.1% year over year to 5.5 million metric tons. Sales fell 15.4% year over year to $4.3 billion. Average steel selling price declined 18.2% year over year to $715 per ton.
Brazil: Crude steel production fell 11.1% year over year to 2.7 million metric tons. Shipments fell 18.4% year over year to 2.4 million metric tons. Sales declined 26.2% year over year to $1.6 billion. Average steel selling price fell 8.8% year over year to $642 per ton.
Europe: Crude steel production fell 19.9% year over year to 9.9 million metric tons in the reported quarter. Shipments fell 19.5% year over year to nearly 9.3 million metric tons. Sales fell 27.1% year over year to $7.7 billion, while average steel selling price declined 12.5% year over year to $638 per ton.
Asia Africa and CIS (ACIS): Sales fell 12.1% year over year to $1.4 billion. Crude steel production totaled nearly 3 million metric tons, down 9.8% year over year. Shipments fell 1.8% year over year to around 2.6 million metric tons. Average selling prices declined 12.9% year over year to $471 per ton.
Mining: Iron ore production totaled 14.4 million metric tons, up from 14.1 million metric tons in the year-ago quarter. Coal production totaled 1.3 million metric tons, up from 1.2 million metric tons in the prior-year quarter. Sales fell 12.2% year over year to $990 million.
Financials
At the end of the first quarter of 2020, ArcelorMittal had cash and cash equivalents of around $4.3 billion, up from $2.2 billion in first-quarter 2019. The company’s long-term debt was $10.7 billion, up 0.6% year over year.
Net cash from operating activities fell 38.8% year over year to $594 million in the first quarter.
Outlook
The company expects steel shipments for the second quarter in the range 13.5-14.5 million metric tons. It expects fixed costs to decline 25-30% in the second quarter resulting from the actions taken by the company to reduce all costs in-line with reduced operating rates. EBITDA for the second quarter is expected to between $0.4 billion and $0.6 billion.
Moreover, the company’s board has suspended dividend payments until the operating environment normalizes. The company also withdrew its guidance for apparent steel consumption.
Price Performance
ArcelorMittal’s shares have lost 33.8% in the past year compared with 30.2% decline of the industry.
Zacks Rank & Key Picks
ArcelorMittal currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the basic materials space are Agnico Eagle Mines Limited (AEM - Free Report) , Newmont Corporation (NEM - Free Report) and Franco-Nevada Corporation (FNV - Free Report) , all carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Agnico Eagle has an expected earnings growth rate of 74.2% for 2020. The company’s shares have surged 58.7% in the past year.
Newmont has an expected earnings growth rate of 96.2% for 2020. Its shares have returned 108.8% in the past year.
Franco-Nevada has an expected earnings growth rate of 22% for 2020. The company’s shares have surged 89.2% in the past year.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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